April 2016 — Property Management Quarterly —
Page 19
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earning how to identify, priori-
tize and implement improve-
ments for energy-conservation
measures in commercial
retrofit and new construc-
tion projects can be difficult. After
eight years of daily research and
practice assessing commercial build-
ings, I am still constantly learning
about cutting-edge technology, new
building codes and updated rebate
programs. There are so many factors
contributing to an understanding of
energy-conservation measures, and
this article will help shed some light
on how and why it is important to
stay on top of these opportunities. To
the uninitiated, it can be a little over-
whelming.
Green building design for the global
market is in growing demand. Taking
advantage of lower operating costs,
certification and documentation can
provide:
• Quality assurance,
• Higher value at point of sales,
• Higher occupancy rates,
• Increased productivity,
• Higher rental rates, and
• A feeling of doing the right thing.
“Globally, energy efficiency repre-
sents about 40 percent of the GHG
reduction potential that can be real-
ized cost-effectively,” according to the
State of Green Business Report 2016
from GreenBiz.com.
Savvy developers, building owners
and property managers are intelli-
gent investors who know how – and
when – to deploy capital for the best
return on investment. In many Colo-
rado real estate markets, now is the
time and energy-efficiency improve-
ments are the how. How long you
intend to hold onto a property should
directly impact the
specific types of
capital improve-
ments or invest-
ments made toward
existing buildings
and new develop-
ments. Following
are three of the best
ways to improve
your building
through energy-
conservation mea-
sures.
Lower Operating Costs
When evaluating various energy-con-
servation measures, you must analyze
the upfront costs, available incentives,
ease of implementation, various tech-
nologies and the paybacks.
The two main drivers of our need for
ongoing energy-conservationmeasures
education are technological advances
and the ever-changing regulation and
incentive climate. Staying on top of
each of these is a full-time job, so hav-
ing knowledgeable and trusted partners
is imperative.
Current incentives coupled with the
decreasing cost of LED lighting tech-
nologies make lighting projects the
most lucrative investment. So far, only
28 percent of the U.S. market has been
penetrated by LED technologies, and
the U.S. market is poised to be at 95
percent in the next five years, according
to Maryrose Sylvester in “JPMorgan and
Current LaunchWorld’s Largest LED
Upgrade.”
There are dozens of grant, rebate
and financing programs in each city
that push projects to simple paybacks
of only six months to five years.With
the various tools and calculators avail-
able, many companies can offer simple
lighting evaluations for free. For new
construction projects, the incentives
available for specifying more efficient
materials upfront often will make them
less expensive than, or equal in cost to,
older and less-efficient technologies.
And while not strictly associated with
lower operating costs, proper lighting
(even in parking lots, closets and base-
ments) can improve the bottom line by
making the area look and feel safer –
resulting in higher occupancy rates and
decreased liability issues.
“Governors, legislators, regulators
and citizens are increasingly recogniz-
ing that energy efficiency is a crucially
important state resource,” according to
an article on the American Council for
an Energy-Efficient Economy website.
Additional building system improve-
ments and the average paybacks
include:
• Lighting, heating, ventilating and air-
conditioning controls: one to five years
• HVAC equipment: two to seven
years
• Solar: four to 10 years
•Windows: five to 10 years
Many of the faster paybacks are due
to the incentives available.These sav-
ings can then be used for improve-
ments on other existing buildings, new
construction projects or building aes-
thetics.
Certification
Green building certifications, the big
ones being Energy Star and LEED, have
remained steady over the years and
are a major reason for these improve-
ments. Construction of green buildings
appears to have plateaued, based on
the number that have registered for
and been certified by the U.S. Green
Building Council’s LEED rating system.
This can be read in two ways: One, that
the growth of green buildings seen a
few years ago – at least in the U.S. – has
slowed. Or two, that building “green”
has become the new norm and is there-
fore less interesting to early adopters
and the sustainably minded.
Due to the strength of the Colorado
real estate market, many investors are
looking at higher point-of-sale values
and higher occupancy rates as ways to
increase the value of their asset. Sup-
porting those needs, building owners
have reported that new or renovated
green buildings command a 7 percent
increase in asset value over traditional
buildings, according toTheWorld Green
BuildingTrends 2016 SmartMarket
Report.
Documentation
Most building systems, even when
regularly maintained, reach the end
of their useful life at 15 to 25 years of
operation.Therefore, consistent main-
tenance and replacement of equipment
is essential. As an owner or manager,
if you do not have an updated equip-
ment list or you don’t know the equip-
ment’s rated useful life, you are missing
valuable aspects of the “building value”
equation.This information also will
help with the operations and mainte-
nance budget, as well as providing a
useful maintenance tool for the next
owner or manager.
Another item, color temperature, is
important to document, and consis-
tency is key. Having multiple lighting
color temperatures in a single office
RJ Mastic
CEO, Ecosystems
Group Inc., Denver
